One of the most difficult things when preparing to sell your
home is setting the correct asking price. Most folks have an idea of a price
they want to get but this is not always based in fact.
First of all, what you owe on your house or how much money
you need from the sale of your house will not dictate market value at all. In
fact, Market Value is an elusive term in itself. It is the perception of value
between a buyer and a seller. It is also independently determined by external
professional appraisers who determine value only on objective items like square
footage and amount of bedrooms and baths. To add to the confusion there is also
the term assessed value, the value that a municipality assigns to a property to
When preparing to sell your home, it is important to
consider all of these factors. Your property should have a correct assessed
value. If the property assessment is too high, it should be grieved to reduce
the tax burden. Taxes affect the perception of value on the part of a buyer.
The higher the taxes the less money a buyer can qualify for in mortgage money
for your property.
Appraised value is the amount that a bank determines through
an independent appraisal that is will use to decide a loan on a house. There
are times when a buyer who believes themselves to be qualified will be unable
to proceed with a transaction because they home does not appraise to a value to
support the purchase price and the mortgage amount necessary.
There are times that a perceived value by buyer and seller
are not supported by appraised value. The sale then can only be completed by a
buyer with enough cash to pay an additional down payment to comfort the bank or
to pay cash for the property which reduces your buyer pool.
When selling your home, you want to attract the largest pool
of buyers possible. This will result in the most showings and therefor the most
offers. Price it too high and your pool of buyers is reduced. People often shop
the internet for homes and while their focus is finding a home, they are
looking to eliminate homes from viewing. If they think the home is priced too
highly they will not make an appointment to view the property and this will
reduce the pool of buyers and thereby the offers on the property.
You interview numerous realtors to list your house and they
all have different numbers. Some are high and some are low. Some tell you they
have buyers lined up already. How to choose and whom to believe.
The fact is you can only sell your home for what someone is
willing to pay. You have to look at your competition and see what is active and
what has sold. You have to try to see your home how a buyer might. The supply
of houses is also a factor. The more houses to choose from the more selection for
the buyer, the softer the price will be.
Realtors should be able to show you the properties that they
used to determine the price they have given you, the comps (comparables). The
properties should be like yours in square footage, location and other amenities.
Price too high, you will not get showings: few showings=less buyer pool= less
offers. Price low, you will have many showings. If there are no offers despite
multiple showings, something is wrong with the house or the price. People are
looking at it and not perceiving the value.
The longer the house is on the market, the more likely
people are to think there is something wrong with the house. This is why most
realtors want to price correctly, get the maximum showings, get the most offers
and choose the best. Remember there are realtors that will take a listing for
an inflated price just to get the listing and will work on bringing you down
rapidly on price. Some of us will take the listing with automatic price
reductions built in the contract knowing that the price is too high. The
problem with this strategy is that your best shot at the market is coming in
priced correctly. You want lots of interest and action.
So how to decide? Look at the comps, what has sold and what
is available. Look at your neighborhood, is it in demand? Are there many
properties for sale? Assess your need to
move or sell. Consider the lower of the estimated sales prices. Look at the
range of prices being suggested. Think about one that is in the middle of the
range. Ask the realtor about their pricing strategy, the one that tried to
price right and is eager to sell more than is eager to list is your best
choice. Without action on your property, you are in the same boat as before you
listed. We are no longer in a pure buyers’ market here in the greater NYC metro
area. The market is making some sensible strides and prices are on an upswing.
This does not mean that your property priced will over market will be a good
idea. You can only sell for what someone is willing to pay. If you don’t sell
at all, you have nothing,
Author:Mary Kingsley Phone: 917-292-5378 Dated: April 8th 2014 Views: 5,015 About Mary: I have a long background in public service. I am a Registered Nurse with a BA and an MPS in Health C...
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